Conventional Loans

Conventional mortgages are among the most popular financing options for homebuyers and homeowners across the country. These loans are not backed by the government, which gives lenders more flexibility and allows qualified borrowers to benefit from competitive rates, a variety of terms, and options for primary residences, second homes, and even investment properties. Start your pre-approval here to see if a conventional mortgage is the right fit for you.

What is a Conventional Mortgage?

A conventional loans are home loans that aren’t insured or guaranteed by a federal agency like the FHA, VA, or USDA. Most conventional mortgages are “conforming,” meaning they meet the standards set by Fannie Mae and Freddie Mac. These loans are issued through private lenders and can be used to purchase or refinance residential property. Compare all available loan types here.

Who Qualifies for a Conventional Mortgage?

To qualify for a conventional mortgage, lenders typically look for a credit score of at least 620, a manageable debt-to-income (DTI) ratio—usually below 45%, and verifiable income and assets. If you have stronger credit and a stable financial profile, you’ll likely qualify for better terms. Unsure where you stand? Reach out to our team for guidance.

Minimum Down Payment Requirements

You don’t need a 20% down payment to get a conventional mortgage. First-time buyers may be eligible for as little as 3% down, while most repeat buyers need at least 5%. Although putting 20% down eliminates the need for PMI, many borrowers choose to put less down and allocate funds elsewhere. See if you qualify for down payment assistance.

Understanding Private Mortgage Insurance (PMI)

Private Mortgage Insurance is generally required if your down payment is less than 20%. PMI protects the lender in case of default, and its cost varies based on your credit score, loan amount, and down payment. Fortunately, PMI can often be removed once your loan reaches 78% loan-to-value. Learn how to remove PMI through a refinance.

Loan Limits for Conventional Loans

The Federal Housing Finance Agency (FHFA) sets annual loan limits for conforming conventional mortgages. In 2025, the baseline loan limit is $806,500 in most areas, with higher limits in high-cost regions. Loans that exceed this limit fall into the jumbo mortgage category. Explore jumbo mortgage options for higher-value homes.

Fixed-Rate vs. Adjustable-Rate Mortgages (ARMs)

Conventional loans are available as fixed-rate or adjustable-rate loans. A fixed-rate mortgage offers stability and predictable payments, while an ARM begins with a lower rate that adjusts over time. Choosing between the two depends on your long-term goals and risk tolerance. Let’s help you run the numbers.

Property Types and Occupancy Rules

Conventional mortgages can finance primary residences, second homes, or investment properties. Each property type has specific requirements, such as down payment thresholds and reserve requirements. Investors often choose conventional financing due to its long-term benefits. Learn about investment property mortgages here.

Conventional Loans vs. Government-Backed Loans

Conventional loans differ from government-backed options like FHA, VA, and USDA loans. While conventional loans often require higher credit scores and stricter documentation, they also offer lower costs over time and greater flexibility. Explore VA options or compare FHA loans here.

Using a Conventional Loan to Refinance

Conventional mortgages are ideal for both rate-and-term and cash-out refinancing. Whether you want to lower your monthly payment, pay off your mortgage faster, or tap into home equity, refinancing into a conventional mortgage offers flexible benefits. Get your custom refinance quote today.

Documentation Requirements

Typical documentation for a conventional mortgage includes pay stubs, W-2s or tax returns, bank statements, and asset verification. Self-employed borrowers may need to provide additional records. We streamline the process with a secure online application and digital upload system. Apply now to begin.

Why Work With the JD.Mortgage Team?

We’re not just another lender—we’re your mortgage partner. Whether you need help navigating PMI, choosing a rate structure, or qualifying for a low down payment, we guide you every step of the way. No overlays, no unnecessary hurdles, just clear answers. Connect with us now for personalized advice.

Explore All Loan Options

In addition to conventional mortgages, we offer FHA, VA, USDA, down payment assistance (DPA), investment property loans, non-QM (DSCR, bank statement, ITIN), HELOCs, second mortgages, reverse mortgages, and construction loans. No matter your scenario, our team is here to guide you toward the right product. Explore all mortgage types with us.